Supplementary Covenant and constitutional savings upheld for a sales tax ordinance continuing as existing law

The document addresses whether a Supplementary Covenant validly amended the Original Covenant so as to preserve the Rajpramukh's ordinance-making power, and whether a Sales Tax Ordinance remained valid after the Constitution of India came into force in the State. It states that the covenanting rulers had not exhausted their power to alter, amend, or abrogate the Covenant, so the Supplementary Covenant was treated as a valid amendment under binding precedent. It further notes that the Ordinance continued in force until the Constitution commenced in the State and thereafter operated as an existing law under Article 372. The challenge to both instruments failed.

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Issues: Whether the Supplementary Covenant validly amended the Original Covenant so as to preserve the Ordinance-making power of the Rajpramukh, and whether the Sales Tax Ordinance continued to be valid law after the Constitution of India came into force in the State.

Analysis: The Original Covenant was treated as having transferred complete sovereignty from the Covenanting Rulers to the new State, but the Court followed the existing Division Bench authority holding that the Rulers had not exhausted their power to alter, amend, or abrogate the Covenant. On that basis, the Supplementary Covenant was regarded as a valid instrument amending the Original Covenant. The Ordinance, therefore, remained in force until the Constitution of India commenced in the State and thereafter continued as an existing law under Article 372 of the Constitution of India.

Conclusion: The challenge to the validity of the Supplementary Covenant and the Ordinance failed, and the petition was dismissed.

Ratio Decidendi: A covenanting authority may validly amend the original covenant in the manner recognized by binding precedent, and an ordinance in force at the commencement of the Constitution continues as valid law under the constitutional savings provision.

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